A U.S. parent company's foreign retained earnings are not adjusted for currency movements to reflect each year's operating profits or losses.

Question

Quizplus · Accepted Answer

U.S. parent companies must adjust their foreign subsidiaries' retained earnings for currency movements to accurately reflect each year's operating profits or losses in their consolidated financial statements, according to U.S. GAAP and IFRS. This ensures that the financial statements present a true and fair view of the company's financial position.

A US Parent Company's Foreign Retained Earnings Are Not Adjusted for for Currency